Making Tax Digital – April 2026
You may have seen recent news about Making Tax Digital (MTD) for Income Tax, part of HMRC’s plan to modernise the UK tax system and move more reporting online.
In the coming years, these changes will affect some individuals with self-employment or property income.
While the rules may not apply to you personally, please feel free to pass this information on to anyone who might be impacted.
Below we explain what the changes involve and who they are likely to affect.
Important Tax Change – Making Tax Digital for Income Tax
HMRC is introducing Making Tax Digital (MTD) for Income Tax, which will change how some individuals report income to HMRC.
Who will be affected?
From 6 April 2026, the new rules will apply to individuals who:
- are self-employed (sole traders), or
- receive income property,
and whose combined income from these sources exceeds £50,000 per year (before expenses).
The rules will later extend to those earning:
- over £30,000 from April 2027
- over £20,000 from April 2028
What will change?
If you fall within the new rules, you will need to:
- keep digital records of income and expenses
- use compatible accounting osftware
- send quarterly updates to HMRC
- submit a final annual declaration confirming your tax position
Instead of submitting one Self-Assessment tax return each year, information will be provided to HMRC throughout the year.
What you should do now?
If your income may exceed the relevant threshold, it may be sensible to:
- review your 2024/25 tax return figures
- consider whether you will need digital accounting software
- review how you currently keep financial records
If you have any questions or concerns about how these changes may affect you, please feel free to contact us.
Helpful resources
We hope you found this information useful, If you would like to discuss how these changes may affect you, please feel free to contact us. You are also welcome to share this with anyone you know who could be impacted.
Kind regards,
Halcyon Financial Planning
